A Lack Of Love For This Team

Cos it’s our club long after they have gone.

 

What clubs do you think make profit year on year? Not many until recently had better debt management than us.

 

It's their choice to do that. They always have the option not to continue doing it and the club ultimately becomes insolvent and goes into administration, at which point they lose their investment to date, but don't have to continue funding it. Alternatively, they could look to sell the club, and we become reliant on the new owners choosing to fund it, rather than asset strip it.

Look at what's happening with Reading, or what Chansiri is constantly threatening with Wednesday (and so far reneging on each time).

 

I understand all that Sheriff, and what problems we might or will eventually face, if these 'financial gaps' stop getting paid.
But I will ask yet again, what are they doing (or what are they trying to do long term), in running a lower level English footy club like ours.

 

Make a profit by selling our best players?

 

The only way to guarantee a return on investment is to get promoted to the Premier League once, which would generate a profit on share sale at that point, or to find a sustainable model of player recruitment and sales that generates a recurring profit.

We were a Championship club when Neerav and JAQ purchased their original financial stake (JAQ as a shadow investor via Conway at the time). The first scenario was feasible at the time (and almost realised in the miracle season under Val), but it's clear that the intention was to achieve a return via the second option (remember Khaled's comments that the Val season was a failure as no-one made offers for the squad members?) They attempted this, but overlooked the fact that it can't come at the cost of on-field performance (as soon as you hit League One, the opportunity to turn big recruitment profits is drastically reduced, compared to the Championship). They blooded players in the Championship before they were ready, at the cost of their form/confidence. Mads was a perfect example. It was only the re-start in front of empty stadia that allowed him to develop into the player he ultimately became.

Brentford are the 'classic' example of a team that followed the second strategy well, but it took huge financial support from the owner to achieve it, and they ultimately achieved the first strategy on the back of it too. Luton are the model of what could be achieved via the first route without the second one.

Long-term, either is feasible for us, but we need to be a low-budget club in the Championship to have any hope of achieving either option. The investment is purely being made in the expectation that we can achieve that as a start point.

 

Hey guys, can I mention Sir Peter Doyle here..
(and yesss, now I'm having to duck down and hide and dodge all of the critical flying Burnsley flak lol).
He as far as I can remember in '02, was one of the first to suggest the 'self sustainable' thing. Regarding the fact that he as the Chairman/owner couldn't and wouldn't keep helping the club out with payments.
Did this idea for the club, go back any further than that ?.

 

Self-sustainability wasn't an issue prior to the Premier League existing. Clubs, with the odd exception every now and then, survived for over a century in the Football League structure. BFC, like most, sold their better players at a profit to achieve this, but this was prior to the introduction of transfer windows, so they were free to do so right up to the transfer deadline towards the end of each season.

The formation of the Premier League was the start of the problem, creating a distorted two-tier system which required the need for parachute payments to protect teams relegated from it. This has been distorted even further by the parachute payments lasting 4 years, rather than the original 2. In order to compete against clubs with parachute payments, Championship clubs started to take financial risks to bridge the gap, resulting in the spiralling wage inflation that made club wage bills exceeding turnover (a ludicrous phenomenon that is unique to football, and perhaps a few other sports) something which became the norm.

At the same time, the Bosman ruling took away the ability for clubs to sell a player at full value at any point in his contract, by given them the rights to walk away on a free transfer at the end of it. This was a game-changer in terms of football financial sustainability.

Ultimately, the ITV digital collapse was the trigger which sent many EFL clubs into administration at some stage, of which we were one of them, due to a relatively modest request for an increased overdraft being refused. P. Turdoyl might have talked about sustainability, but at the same time as he purchased the club against loans made on it's assets, and from which he commenced an asset-stripping exercise. Ultimately, this was the reason why Patrick Cryne separated the ownership of the stadium from the club, to protect it from future attempts to do the same thing. As the Conway era showed, this was a shrewd move which prevented them from de-stabilising the club any more than they actually achieved.

So, in a nutshell, the formation of the Premier League, the Bosman ruling and the ITV digital deal were the 3 triggers that made the type of sustainability as a survival exercise scenarios necessary. Prior to that, football clubs were run largely in the same way as any other limited company, with normal operating cost models where wages don't exceed turnover.

 

How.much money have JAQ and Nareev taken out of our club?

 

£10.2m has been put in by the directors of the club since February 2023.

 

I thought so but with all the grief to the Directors I thought they must have taken out loads more than they have put in.

 

Since they took over the club has lost over £18m.